On December 18, 2000 Steven Frank Lovato was sentenced to six years in state prison after his conviction on charges of securities fraud and misapplication of fiduciary property in the 263rd District Court of Harris County, Texas.
Lovato was a day trader who obtained the retirement funds of a couple in Kileen, Texas and thereupon misapplied funds and lost funds day trading.
In connection with the securities offering, Mr. Lovato intentionally failed to disclose that he was on probation for the offenses of aggravated assault on a public servant and possession of over 50 pounds of marijuana.
Lovato also intentionally failed to disclose that he was not a registered securities dealer or agent and that he intended to misapply victim funds. The matter was prosecuted by the Consumer Fraud Division of the Harris County District Attorney's Office with the assistance of the Texas State Securities Board.